Carraway hospital closing doors after 100 years

Physicians Medical Center Carraway is closing its doors after 100 years in business.

The cash-strapped hospital is closing its emergency department today and is not taking any new patients, the board communicated in a written statement. The hospital will file for bankruptcy protection "to ensure patient care and the orderly shutdown of the facility," the statement said.

Hospital management is meeting with its employees and medical staff this morning to give them the news.

"We are saddened by the necessity of this action, but the hospital has exhausted all other measures to overcome the financial obstacles facing it," the board's release said.

Board members met much of the weekend to discuss the hospital's fate. The hospital's landlord provided an emergency cash infusion Oct. 9 to make payroll the next day, after the hospital had teetered on the brink of bankruptcy the entire week.

Earlier the hospital had its credit line frozen. The loan was only enough to get the hospital through a few weeks to see if there was a possible long-term fix.

The hospital employs about 1,000 workers. But Physicians Carraway, licensed for 617 beds and staffed for about 200 beds, has had about 100 or fewer hospitalized patients in recent weeks.

L & B Realty, the hospital's landlord of Dallas, Texas, spent last week in Birmingham looking for a solution. Getting some of Jefferson County's patients from Cooper Green Mercy Hospital was one option explored, but that was unlikely to be a large boost. A South Korean company had expressed interest this summer in investing, but the money was too slow in coming.

"In recent weeks, Physicians Medical Center Carraway has been pursuing certain strategic initiatives that would have allowed it to continue in operation," the statement said. "Unfortunately, time and declining patient volumes did not permit it to capitalize on these opportunities."

This is the second bankruptcy for the hospital. Carraway Methodist Medical Center filed for bankruptcy in Sept. 2006. The current owners, a group of 52 local doctors, bought it out of bankruptcy in Nov. 2006 with the hope of increasing patient volumes through more referrals from the investors, most of whom were not practicing at Carraway at the time.

But the new owners didn't have much operating capital, the hospital needed tens of millions in upgrades and the increase in patients wasn't big enough to save the Norwood institution.

"We wish to thank our dedicated employees, medical staff and the community for the many years they have supported the hospital," the board said.